The Federal Reserve said it would sunset a program specifically to monitor banks’ digital assets activities and would integrate them back into its “standard supervisory process.”
The Federal Reserve Board said that it would end a “novel activities supervision program” set up in 2023 to supervise certain activities related to crypto assets and distributed ledger technology.
In a Friday notice, the Fed said it will sunset the program created in August 2023 and return to “monitoring banks’ novel activities through the normal supervisory process.” The 2023 program said it would be “risk-focused” and include supervision of banks providing “deposits, payments, and lending to crypto-asset-related entities and fintechs.”
“Since the Board started its program to supervise certain crypto and fintech activities in banks, the Board has strengthened its understanding of those activities, related risks, and bank risk management practices,” said the Fed. “As a result, the Board is integrating that knowledge and the supervision of those activities back into the standard supervisory process and is rescinding its 2023 supervisory letter creating the program.”
Though not necessarily suggesting a scaleback in oversight of banks dealing with crypto companies, US government agencies have taken a softer approach to regulating and handling digital assets under the Trump administration.
Since January, the Securities and Exchange Commission has dropped several investigations and enforcement actions into crypto companies, and statements from leadership at the Treasury suggested the department would fall in line with the White House’s policy setting up a national crypto reserve.
Related: Trump to sign executive order punishing financial institutions for ‘debanking’: Report
Leadership at the Fed becoming a political issue
US President Donald Trump has been publicly challenging the Fed’s independence in determining federal interest rates, often personally criticizing Chair Jerome Powell, whom he nominated in 2017. Powell’s term as chair is expected to end in May 2026, while his term as a Fed governor won’t end until January 2028.
Adriana Kugler, a member of the Fed’s board of governors and the Federal Open Market Committee, resigned from her position on Aug. 8. Trump nominated Council of Economic Advisors Chair Stephen Miran to fill Kugler’s role until January, when he is expected to pick a permanent replacement.
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